Question

Calculate the simple interest and compound interest for a principal of ₹ 25,000 at the rate of 10% per annum for two years.

• A. SI = ₹ 5,000, CI = ₹ 5,250
• B. SI = ₹ 5,250, CI = ₹ 5,000
• C. SI = ₹ 5,000, CI = ₹ 5,000
• D. SI = ₹ 5,250, CI = ₹ 5,250

Answer 1

The correct option is A SI = ₹ 5,000, CI = ₹ 5,250

Given,
P = ₹ 25,000 , N =2 years , R = 10%

Simple Interest:
SI =$\frac{PNR}{100}$ = $\frac{25,000\times 10\times 2}{100}$
= ₹ 5,000

Compound Interest:
For 1st year the principal is ₹ 25,000
CI =$\frac{PNR}{100}$ = $\frac{25,000\times 10\times 1}{100}$
= ₹ 2,500...(i)
For 2nd year the principal is = ₹ 25,000 + ₹ 2,500
= ₹ 27,500
CI =$\frac{PNR}{100}$ = $\frac{27,500\times 10\times 1}{100}$
= ₹ 2,750...(ii)
CI for 2 years is = (i) +(ii)
=₹ 2,500 + ₹ 2,750
=₹ 5,250.